ITC reaffirms partial ban on Qualcomm chips: Qualcomm continues to pursue presidential veto and federal appeal

A partial ban on the importation of new handset models containing Qualcomm Inc.’s 3G chips will remain in effect as the chip vendor’s appeal is heard in a federal court and considered by the Bush administration.
The United States International Trade Commission ruled yesterday that its four-prong test-a test also used by the federal circuit courts-to determine whether a stay should be granted had not been met. Thus the ban that officially began on June 7 remains in effect, barring new handset models containing Qualcomm’s W-CDMA or CDMA2000 1x EV-DO chipsets.
Handset models imported prior to the June 7 ban are exempted, thus the ITC’s term “limited exclusion order” is rendered in plain language as a “partial ban.”
The decision came despite urgent filings by Qualcomm and a slew of wireless players who requested a stay of the ITC’s ban while the issue is considered by a federal appeals court. Qualcomm had been joined by the nation’s four, top-tier network operators-Verizon Wireless, AT&T Inc., Sprint Nextel Corp. and T-Mobile USA Inc.-as well as leading handset vendors including Motorola Inc., Samsung Electronics Co. Ltd., LG Electronics Co. Ltd. and Kyocera Wireless Corp.
Broadcom Corp. and the ITC’s own investigative attorney opposed the efforts to stay the handset ban. Broadcom had brought the original complaint of patent infringement against Qualcomm and won the handset ban on June 7 as a means to protect one of its patents pertaining to power management.
Broadcom issued a statement lauding the ITC’s commitment to the protection of intellectual property “essential to American competitiveness and innovation in global markets.”
“We’re disappointed with the ITC’s denial of the stay despite some commissioners agreeing that a stay should be granted,” said Christine Trimble, a Qualcomm senior director. “However, we can now proceed with our motion to stay that has been filed with the federal circuit court of appeals. Qualcomm and its industry partners are focused on obtaining a stay through the federal circuit and on presidential veto.”
The ITC ruled yesterday that four criteria had not been met by Qualcomm and other filers, who had to establish that:
1, an appeal would be likely to succeed on its merits,
2, irreparable harm would occur without a stay,
3, issuance of a stay would not irreparably harm other parties, and
4, the public interest favored a stay.
In the wake of the ITC’s decision against a stay, those opposed to the ban continue to pursue two other legal avenues. One is issuance of a presidential veto of the ITC decision, which requires action by the executive branch through its U.S. Trade Representative. According to the Washington, D.C., law firm of Stifel Nicolaus, which specializes in telecom, media and technology regulation, the last such presidential veto of an ITC decision came more than two decades ago. Yet the law firm issued a statement that while Qualcomm’s request for a veto has “a good chance,” the firm believes the process will “go to the wire”-in other words, a veto if granted would come at the end of the 60-day period that began June 7.
The other avenue for seeking reversal of the ITC decision is through the federal appeals court process, which Qualcomm has initiated.
Both efforts remain ongoing in the wake of the ITC’s affirmation of its partial ban.
Qualcomm said earlier this week that the partial ban would affect the importation of its MediaFLO handsets for mobile TV, but did not mention specific models. The Qualcomm statement thus appeared to be an attempt to heighten the sense of the impact the ITC’s ban would have on innovative new services, the public interest and the ecosystem of businesses involved in MediaFLO-related services.
AT&T Mobility and Verizon Wireless have both selected Qualcomm’s MediaFLO as their technology of choice in launching mobile TV services. Verizon has already launched its service and AT&T expects to do so later this year.